Options  |  AUG 2001

The Iron Condor by Jesse Chen

The Iron Condor by Jesse Chen Being neutral on the market is different from being unsure. Here’s a strategy to take advantage of your view. Neutral options are a sound strategy in options trading. They combine a balanced risk and reward ratio with a high probability of profit and wide profit zone. Neutral options come in three main flavors: short strangles and straddles; butterflies; and iron condors. These positions are appropriate to use when you expect the market to go nowhere or, if the market does go in some direction, the strategy will be able to take advantage of the movement. I’m going to describe the former situation.

by Jesse Chen